Advertisement
Advertisement

USD/JPY Monthly Fundamental Forecast – March 2016

By:
Barry Norman
Published: Feb 29, 2016, 18:41 UTC

Outlook and Recommendation The USD/JPY will open March at 112.94 seeing a dip of close to 7% for the month as the yen rallied most of the month on safe

USD/JPY Monthly Fundamental Forecast – March 2016

usdjpy monthly bnsnla
Outlook and Recommendation

The USD/JPY will open March at 112.94 seeing a dip of close to 7% for the month as the yen rallied most of the month on safe haven trades. The JPY fell at the end of the month as improved investment sentiment triggered fund outflows as Japan’s core inflation stayed unchanged in January, compared with the previous figure of 0.1%. Outlook analysis: The BoJ may cut the interest rate from -0.1% to -0.3% in July as core inflation may become negative for the coming months on weak energy prices and a rebound in JPY. However, the measures may have limited impact on liquidity, which may limit JPY downside.

After finding a seeming floor at zero, headline CPI is near 0.3 percent. Excluding fresh food, the traditional core measurement in Japan, CPI shows slight deflation. However, Japanese officials seem to be giving more credence to measures of inflation that exclude energy as well. Core CPI excluding fresh food and energy sits closer to 1.0.

Traditionally, Japan core CPI is calculated as all items less fresh foods. Japan’s calculation differs drastically from other nations as they leave energy included in their core CPI rating. If the US were to include energy in its core CPI measurement, we could expect a materially lower print driven by sharply declining energy components across the board – projected at less than 0.5 percent. The heavier weight in food would not impact the number as drastically, with the food component posting a year-over year increase close to the 1.9 percent core inflation figure.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

usdjpy m

Upcoming Economic Events that you should be monitoring:

March 1, 2016

    CNY Manufacturing PMI        
    CNY Caixin Manufacturing PMI        
    AUD Interest Rate Decision        
    AUD RBA Rate Statement        
    EUR German Manufacturing PMI        
    EUR German Unemployment        
    GBP Manufacturing PMI (Feb)        
    CAD GDP (MoM) (Dec)        
    USD ISM Manufacturing PMI (Feb)        
March 2, 2016  
    AUD GDP (QoQ) (Q4)        
    GBP Construction PMI (Feb)        
    USD ADP Nonfarm Employment        
    USD Crude Oil Inventories        
March 3, 2016  
    GBP Services PMI (Feb)        
    USD ISM Non-Manufacturing        
March 4, 2016  
    AUD Retail Sales (MoM) (Jan)        
    USD Nonfarm Payrolls (Feb)        
    USD Unemployment Rate (Feb)        
    CAD Ivey PMI (Feb)        
March 8, 2016  
    JPY GDP (QoQ) (Q4)        
    CNY Trade Balance (USD) (Feb)        
March 9, 2016  
    GBP Manufacturing Production        
    CAD Interest Rate Decision        
March 10, 2016  
    NZD Interest Rate Decision        
    CNY CPI (YoY) (Feb)        
    EUR Interest Rate Decision (Mar)        
March 11, 2016  
  CAD Employment Change (Feb)        
March 12, 2016  
  CNY Industrial Production (YoY) (Jan)        
March 14, 2016  
  NZD GDP (QoQ) (Q4)        
March 16, 2016  
    GBP Average Earnings Index        
    GBP Claimant Count Change (Feb)          
March 17, 2016  
    NZD GDP (QoQ) (Q4)          
    AUD Employment Change (Feb)          
    EUR CPI (YoY) (Feb)        
    GBP Interest Rate Decision (Mar)          
March 18, 2016  
    CAD Core CPI (MoM) (Feb)          
    CAD Core Retail Sales (MoM)          
March 21, 2016  
  Japan – Spring Equinox Day  

 

 

 

About the Author

Did you find this article useful?

Advertisement